Multiplying impact: supporting the replication of inclusive business models

Publication by Endeva

In recent years, companies both large and small have worked to develop inclusive business models in a variety of sectors and countries. These activities demonstrate that positive social and economic results can be achieved by integrating people living in poverty into value chains, whether on the demand side as consumers or on the supply side as producers, employees or entrepreneurs.

To date, however, only a handful of inclusive business models have managed to reach significant scale. One example of success is Greenlight Planet’s solarpowered Sun King lamp, which has positively affected the lives of approximately 3.9 million low-income consumers in 31 countries since 2008. Yet, there are 1.3 billion people worldwide who still lack access to electricity, and many more who would benefit from solarpowered lighting alternatives despite having access to electric power.

After at least 10 years of experimentation, we need to recognise what works and replicate it. Replication is the most effective and efficient way to reach the people at the base of the pyramid, the 4 billion people living on less than US$ 3,000 per year, with essential goods and services while providing them with economic opportunities. If we learn how to support replication, we can help multiply the impact of inclusive business.

However, this requires support from a variety of actors throughout the inclusive-business ecosystem, both within their home markets and in new target markets. This report therefore addresses development partners, multinational corporations based in developing and developed markets, investors, local banks, accelerators, think tanks, universities, chambers of commerce, non-governmental organisations (NGOs) and all the other actors in the inclusive-business ecosystem. It seeks to provide guidance on how best to support the replication of inclusive business models.

It therefore defines replication, explains the paths that inclusive businesses follow in the replication process, and makes targeted recommendations based on three primary challenges faced by inclusive businesses: the lack of information on and knowledge about replication; the difficulty in finding the right people and partners to execute replication plans; and the general absence of financing instruments tailored to support replication.